Canada’s labour market once again stayed the course, experiencing minimal change according to Statistics Canada’s June labour force survey. This past month the Canadian job market saw another slight decline in employment (-1,400 jobs) and an equal change to both the employment (-0.2%) and unemployment (+0.2%) rates – the highest unemployment rate since 2017 (excluding the pandemic). This slow and steady decline over the past year highlights underlying challenges, such as rising youth unemployment and wage disparities.

However, there is a great deal of opportunity for Canadian businesses to take strategic action while others look at a glass half empty. At Agilus, we believe in transforming these current employment challenges into opportunities for finding great talent and developing your internal workforce, ensuring that our clients are well-positioned to navigate this evolving landscape.

The Current Employment Landscape

The overall unemployment rate in Canada rose to 6.4% in June, an upward trend that has persisted since April 2023, reflecting a total raise of 1.3 percentage points. Outside of the pandemic years, Canada has not seen such a high unemployment rate since the early 2010s when Canada was recovering from the global financial crisis of 2008-2009. The Canadian economy at that time is similar to what we’re seeing today ­— cautious consumer spending, inflationary pressures, and a high degree of uncertainty in global markets.

Older workers are being particularly affected, with 22% of unemployed persons aged 55 and older falling into the long-term unemployed category, compared to 19.3% for core-aged (24-55) workers and 12.2% for youth (24 and younger). This trend is problematic, whether it’s ageism or a bias against unemployed workers, long-term unemployment can lead to skill atrophy, financial instability, and increased difficulty in re-entering the workforce. At a time when Canada is welcoming workers at unprecedented rates, it is important for governments and employers to support all job seekers with opportunities for reskilling and upskilling.

Moreover, the unemployment rates for equity-seeking demographic groups have also shown notable increases. For core-aged Black Canadians, the unemployment rate rose by 4.4% to 11.9% over the past year. Black men have been disproportionately affected with a 5.7% increased, while women have faced a 3% increase. Similarly, the unemployment rate for core-aged South Asian Canadians has also increased above the national average by 1.7% to 6.7%, with South Asian women facing a higher rate of 7.8%. In comparison, the unemployment rate rose by only 0.3% to 3.8% over the last year among the non-racialized, non-Indigenous population of core working age.

Industry-specific trends also paint a concerning picture. Employment in transportation and warehousing fell by 12,000 (-1.1%) in June, following a decline of 21,000 (-1.9%) in May. This marks the second consecutive month of job losses in a sector where Canada and particularly Ontario are heavily invested. Public administration also saw an employment decline of 8,800 (-0.7%), the first decrease since August 2023.

However, there were some predictable seasonal gains with employment in accommodation and food services increasing by 17,000 (+1.5%) and agriculture seeing a rise of 12,000 (+5.5%) in June.

Currently, there are 1.4 million Canadians actively seeking work, an increase of 42,000 from May. Ultimately, these figures highlight the importance of targeted support and reskilling initiatives to help bridge the gap between job seekers and available opportunities.

Youth Unemployment and Returning Students

Youth unemployment continues to be a critical issue, rising to 13.5% in June, the highest rate since 2014 (excluding the pandemic years). Employment among young men aged 15 to 24 fell by 13,000, while the rate for young women remained steady. This trend reflects the broader difficulties faced by younger workers in securing stable employment.

The situation is even more pressing for returning students, with their employment rate falling to 46.8%—the lowest since 1998, excluding June 2020. This drop highlights the critical need for businesses to invest in the next generation of workers. Students bring fresh perspectives and energy — providing them with meaningful employment opportunities can significantly benefit both their career trajectories and the future workforce.

However, the challenges faced by youth and returning students also signal a call to action for employers. Companies can play a pivotal role by offering internships, apprenticeships, and entry-level positions that provide valuable experience and a foothold in the job market. By investing in the youth, businesses not only contribute to the community but also cultivate a pipeline of skilled workers for the future.

Wages Increase, but Not Equally

On a brighter note, wages have continued to rise, with average hourly wages up 5.4% year-over-year in June. This increase is encouraging, however it’s important to note the disparity in wage growth. While wages for the bottom 25% of earners has increased by 4.2%, wages for the top 25% saw a more substantial rise of 6.9%. This wage gap indicates ongoing inequality in the labour market.

Looking Forward

The June labour report yet again presents a mixed bag of challenges and opportunities. While the increase in the unemployment rate and the decline in youth employment are concerning, the rise in wages and job growth in certain sectors offer a glimmer of hope. In order to grow our economy for years to come, it is crucial for businesses in Canada to recognize these trends and take the steps necessary for growth and financial stability.

“At Agilus, we see these challenges as opportunities to foster resilience and growth,” says Agilus CEO, Craig brown. “By adapting recruitment strategies to the evolving labour market, employers can attract and retain workers for today’s market and tomorrow’s opportunities. Our commitment is to empower both businesses and job seekers resulting in better outcomes for both.”

Take the lead in shaping the future workforce of your organization. At Agilus, we provide tailored solutions, enabling businesses to achieve better outcomes. With 48 years of experience, our national team of recruitment experts utilize insights from data analysis, technology-enabled solutions, and a deep understanding of market dynamics to help both our clients and candidates thrive in a continuously evolving job market. Ready to see the difference a total talent solutions firm can make for your business? Let’s get to work!